MLC301 Principles of Income Tax Law - Assessment Questions

QUESTION 4.14

Discuss the deductibility of the following items for taxation purposes, giving reasons.
(a) Lim Emporium Pty Ltd is a large distributor of Asian foods. Much of the business of the company is negotiated at sporting clubs and football matches. As a result Lim Emporium pays one sporting club membership per person for each of its top employees.
(b) A fine of $10 000 imposed by a national sporting tribunal on a sports star who breached the organisation’s rules of conduct.